Exxon 2007 Annual Report Download - page 31

IMPR OVIN G OPE R AT ING E F FICI E N CY
Worldwide cash operating costs at our refineries are substan-
tially below the industry average. We achieve industry-leading
unit cost performance by leveraging our scale and integration
as well as our leading-edge technology to capture efficiencies.
We have been successful in developing energy and cost
efficiencies that offset much of the inflationary pressures and
expenses related to operating facility improvements, new
process units, and production growth.
Improved energy efficiency is a key contributor to our cost
performance. ExxonMobil’s proprietary Global Energy
Management System (GEMS) focuses on opportunities that
reduce the energy consumed at our refineries and chemical
complexes. As of year-end 2007, we have captured over
$900 million in pretax annual energy cost savings.
We continue to make significant investments in cogeneration
facilities with several start-ups planned over the next few
years. Cogeneration requires substantially less energy than
separate conventional steam and power generation. Our
GEMS system and cogeneration facilities also reduce
greenhouse gas emissions.
In addition to energy improvement, we reduce costs
through economies of scale. This activity includes common
support organizations at our integrated sites, our global
training initiative, and our global procurement organization.
M AINTA I N ING CAPI TA L DISC I P LINE
Refining & Supply capital expenditures are focused on
selective and resilient investments that yield competitive
advantage. These investments meet product quality
requirements, reduce environmental impact, further upgrade
safety systems, lower operating costs, and produce higher-
value products and chemical feedstocks using lower-cost
raw materials. We also implement projects that enhance
refinery capacity and yield at much less than grassroots cost
and generate an attractive return, even at bottom-of-cycle
market conditions.
E ME RGIN G MARKET G ROW TH
World-class scale and integration, industry-leading efficiency,
leading-edge technology, and globally respected brands
enable ExxonMobil to take advantage of attractive emerging-
growth opportunities around the globe. Our assets are
well-positioned and configured to supply liquids to meet
demand growth in the Asia Pacific region, which we estimate
will average 2 to 3 percent annually through 2020.
In mid-2007 ExxonMobil, along with our partners Saudi
Aramco, Sinopec, and Fujian Province, formed the only fully
integrated refining, petrochemicals, and fuels marketing
venture with foreign participation in China.
The manufacturing portion of the venture expands an existing
80-thousand-barrel-per-day refinery in Quanzhou, Fujian
Province, to a 240-thousand-barrel-per-day, high-conversion
facility. It also includes a world-scale integrated chemical
plant, with a new 800-thousand-tons-per-year steam cracker,
and polyolefins and aromatics plants. The approximately
$5 billion project is expected to start up in 2009.
The Fujian venture allows participation across the value
chain from crude supply and processing through fuels and
chemical marketing and is the only fully integrated venture
announced in China with foreign participation. This integrated
approach, combined with leading technology, scale, and
world-class operations, positions this venture to be highly
competitive in the growing Chinese market.
Energy Intensity
105
100
95
90
2002 2004 2006 2007
(indexed Solomon data)
ExxonMobil Industry
ExxonMobil Refining Cost Efficiency (1) (2)
(1) Solomon data available for even years only.
(2) Only even-year data plotted for 2002-2006.
Investments in energy conservation projects, such as this one
at Crude Unit A at our refinery in Beaumont, Texas, help reduce
operating costs.
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